Spanish inflation rate drops to 1.2 per cent

Falling fuel prices push the rate to its lowest in 7 months

The latest provisional data published by the Spanish government’s central statistics unit show that the annual inflation rate in December was 1.2 per cent, 0.5 points lower than in the definitive report for the previous month and a full point below the level where it remained for six months between May and October.

Should the downward trend be maintained in January, there is a possibility that inflation in Spain could drop to its lowest level since late 2016, when a long period of zero or negative inflation came to an end.

The advance bulletin for December also reports that the retail price index fell by 0.4 per cent during the month, and points to the falling price of fuel as the main factor behind the latest figures. As usual, it should be pointed out that these are only provisional data, but there is unlikely to be much variation when the final figures for the month are published during December.